When Push Comes To Shove: How Wireless Companies Cap Innovation

If there is one thing Google knows it’s that their business is driven by access. The more people who have Internet access are more people who can use Google’s products and services. This is one of the big reasons Google has invested in Google Fiber as well as their audaciously interesting Google Loon project. It’s all about bringing more people better and faster access to the Internet.

While Google has been working to push things forward on the wired Internet, we have been moving backward in the wireless arena. Yes, we now have super fast LTE wireless networks but they have come at a steep price. The days of unlimited data are gone. All the major wireless carriers are now capping data and charging different fees depending on how large of a cap you want. This new capped data is pushing right up against new streaming audio and video services. When so much of the Internet is moving to the “cloud”, it depends more and more on having enough data throughput. If customers have to carefully count bits and bytes and are always worried about going over their data limits, innovative new apps and services that require too much data will die on the vine.

ESPN is the leading sports network in the country and their whole business is primarily driven by video. ESPN is also smart enough to realize video is moving off the big tv and onto mobile devices like cell phones and tablets. Naturally ESPN wants to move with their customers and make their shows available on mobile platforms. Nothing chews up more data than video and cellular data caps are killing ESPN’s ability to deliver video programming to their customers. As a result, ESPN is now offering to pay carriers to make their programming not count against current data caps. This should tell you something about how valuable ESPN thinks continuing to offer video content to their viewers on mobile platforms is.

All of this wold be dandy, with the carriers getting paid by their customers and the networks, except that this all runs afoul of Net Neutrality. Different access for different companies largely dependent on how much money they have creates an unequal ecosystem with its own troubles. This is a maddening problem that speaks to how screwed up the system is here in the U.S. It makes me think access is such a key to the burgeoning new Internet economy that maybe the government should be subsidizing the whole damn thing. We spend/waste so much money on other crazy things, at least this is a clear win; bolstering the tech sector which seems to be one of the only places growth is strong and likely creating many new jobs in the process. Is Internet access such a national priority that the government should be taking a larger role in supporting it? That’s a key question I don’t see anyone pushing on.

What is clear is, wireless data caps are a bad thing. They are great for wireless carriers but no good for consumers and bad for new businesses trying to build themselves off the Internet backbone as well as established businesses trying to transition to the Connected World.